Speaking of Herbert Hoover and the U.S. housing market:
He helped make second mortgages a new financing vehicle by convincing Julius Rosenwald, who built Sears, to issue them at 6 percent interest. Banks, which had been demanding 15 percent, quickly followed. Rising Tide: The Great Mississippi Flood of 1927 and How It Changed America by John M. Barry (Touchstone/Simon & Schuster, 1997). Seth Sandronsky To: [email protected] Subject: Re: Who needs a recession? From: Michael Perelman <[EMAIL PROTECTED]> Date: Tue, 28 Aug 2007 18:09:06 -0700 -------------------------------------------------------------------------------- Here is the reference to Mellon. It goes further than the article: Hoover, Herbert. 1952. The Memoirs of Herbert Hoover (NY: Macmillan): 3, p. 30 "The 'leave-it-alone liquidationists' headed by Secretary Mellon ... felt that the government must keep its hands off and let the slump liquidate itself. Mr. Mellon had only one formula: 'Liquidate stocks, liquidate the farmers, liquidate real estate' .... He held that even panic was not altogether a bad thing. He said: 'It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people." -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu michaelperelman.wordpress.com _________________________________________________________________ Puzzles, trivia teasers, word scrambles and more. Play for your chance to win! http://club.live.com/home.aspx?icid=CLUB_hotmailtextlink
